Mexico and Central America – targets for Finnish environmental exports

In recent years, Finnish environmental exports have mainly focused on Asia, China in particular. There are huge prospects for cleantech exports in China provided that the efforts are successful and Finnish technology is actively purchased. But amidst all the hype about China, have opportunities on the other side of the world been forgotten? Why are virtually all eggs in the same Asia basket?

The damage caused by climate change is especially extensive in Central America and Mexico. There is an urgent need for renewable forms of energy there. Water and air purification and waste management also require significant improvements.

The location of Mexico right next door to the United States is a special advantage of Mexico. Mexico is also a gateway to Central and Southern America. 

Already approximately 30 Finnish companies do business in Mexico and Central America through their own offices. One of these, Pöyry, has been involved in a project to build one of the world’s largest wastewater tunnels, near the capital of Mexico. Pöyry has also contributed to cleaning the largest lake in Guatemala – by means of water hyacinths.

Kemira has been very successful in cleaning the waterways in Mexico. Wärtsilä has built approximately 20 power plants in Central America. That said, there is plenty of room for more Finnish companies specialising in environmental technology. Perhaps it would be even easier to conquer Mexico and Central America than China and India?

Climate change is the biggest threat

Located between two oceans, Central America and Mexico are extremely vulnerable to the impacts of climate change. Major financial loss is particularly caused by damage resulting from heavy rain, hurricanes, landslides and drought.

Statistics show that extreme climate phenomena have considerably increased in recent years. Hurricanes and tropical rainstorms are increasingly frequent. In El Salvador and Guatemala, for example, rainfall was 40% higher in 2009 than the average in 1999.

A substantial part of the national product of Central American countries is spent on preventing and repairing the damage caused by extreme weather phenomena. The more the prevention of global warming is postponed, the more extensive threats we will face. In addition to climate change prevention, these countries are in urgent need of competent solutions which also help adapt to climate change and minimise the damage.

Finnish cleantech expertise could have big opportunities in Central America and Mexico. In addition to technology, there is also a demand for know-how, such as the use of biomass in energy production, and energy efficiency.

Renewable energy is needed

At the moment, energy production in Central America and Mexico is extensively based on coal and oil. Financial growth in the region continuously requires more energy. Now there is an increasingly frequent aim to provide energy in an environmentally sustainable way – solar power, ground source heat and various local biomass are increasingly popular sources of energy.

Investment in renewable energy will be significant. For example, Mexico alone intends to increase its use of wind power to 2,000 megawatts by 2012. Mexico already has EURUS, one of the largest wind farms in the world, with a capacity of 250 MW.

The Central American countries and Mexico are also very interested in Clean Development Mechanism projects.

Since 2002, Finland has carried out a programme with the Central American countries, called the Energy and Environmental Partnership with Central America. This programme aims to decrease the threats of climate change by increasing the use of renewable forms of energy. Central American countries have already implemented over 270 different projects to promote the use of water, solar and wind power, ground source heat and biomass in energy production.

The Energy and Environmental Partnership has been a success story which has considerably increased the awareness of and technology related to renewable forms of energy. Currently, Austria and the EU are also involved in the project funding. The operating model created in Central America has also been replicated elsewhere, such as South Africa, Namibia, Mozambique, Vietnam and Thailand.

Clean water and well-managed waste

At the moment, the majority of those residing in Mexico and Central America are covered by an organised water supply. Although water flows in the pipes, there still is a lot of room for the improvement of water quality. Now stores sell drinking water in plastic bottles, and some products are even imported all the way from France. This is not at all environmentally sound. According to Finpro, the water sector has a need for consulting, pumps, pipes, automation, irrigation solutions, sludge processing technology and biogas systems.

Most cities in Central America and Mexico already have sewers, but most of the wastewater is still pumped untreated into rivers, lakes and seas. Some waste sludge is used to fertilise fields. Significant investment is planned for wastewater treatment in the next few years. For example, the aim in Mexico is to treat 60% of wastewater by 2012.

The treatment of industrial and municipal waste in Mexico and Central America also needs to be improved a great deal. Recycling is a new thing there. Finnish companies could have a lot to offer in these regions, too.

Kari Rissa

The author is an environmental journalist who visited Mexico and Central America in December 2010.